One of the biggest draws of streaming services is their low monthly fees which are usually far below that of cable services. However, those low fees are subject to occasional price hikes or changes per most services’ terms of service. In a move sure to draw criticism and debate, Netflix reportedly tested price hikes over the weekend that could mean monthly subscription costs are about to go up.
According to Australian news outlets, Netflix conducted a weekend experiment down under to test how subscribers might react to such pricing hikes. Some Australian users saw Netflix subscription prices rise by as much as 20% over the weekend, with their Premium plan rising from AU$14.99 to AU$17.99 a month. Crikey.
In a statement to news.com.au., Netflix reps claimed that the price hikes are aimed at determining how much users value the popular streaming service:
We continuously test new things at Netflix and these tests typically vary in length of time. In this case, we are testing slightly different price points to better understand how consumers value Netflix. Not everyone will see this test and we may not ever offer it generally.
Naturally, the move has angered many users and journalists, with some outlets calling the experimental price hike “the most anti-consumer move Netflix has ever made.” Aussie Netflix users already have the disadvantage of being able to only access about 40% of Netflix content due to international and domestic copyright laws. This latest move could further alienate Netflix down under and push more users towards Australian-based streaming services like Stan.
Given many investors’ worries about the sustainability of Netflix’s cash flow model, perhaps a price hike was inevitable. Does this move show Netflix is growing too fast and losing touch with its subscriber base? Are users likely to mind a slight price increase? As long as season two of Stranger Things is as good as the first, all I can stay is “shut up and take my money.”
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